Most markets in Asia fall amid political woes in Japan, Thailand

Most markets in Asia fall amid political woes in Japan, Thailand
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First Published: Tue, Sep 02 2008. 10 52 PM IST

Lacklustre display: A man looks at a board displaying share prices in Tokyo. The Nikkei 225 index dropped 1.75% to 12,609.47 on Tuesday. Yuriko Nakao / Reuters
Lacklustre display: A man looks at a board displaying share prices in Tokyo. The Nikkei 225 index dropped 1.75% to 12,609.47 on Tuesday. Yuriko Nakao / Reuters
Updated: Tue, Sep 02 2008. 10 52 PM IST
Hong Kong: Most Asian markets fell on Tuesday as political turmoil pressured stocks in Japan and Thailand amid persistent pessimism about a global economic slump.
Lacklustre display: A man looks at a board displaying share prices in Tokyo. The Nikkei 225 index dropped 1.75% to 12,609.47 on Tuesday. Yuriko Nakao / Reuters
Tokyo’s Nikkei 225 index dropped 1.75% to 12,609.47 in the wake of Prime Minister Yasuo Fukuda’s surprise resignation.
In South Korea, stocks continued to spiral amid growing worries over the country’s weakening currency and the possibility of capital outflows. The Korea Composite Stock Price Index lost 0.5%, adding to its 4.1% slide in the previous session.
Thailand’s SET index retreated 2.3% to a new annual low as the prime minister imposed a state of emergency after clashes between pro- and anti-government protesters.
Australia’s decision to cut its benchmark interest rate for the first time in nearly seven years also spurred selling as the widely expected move was yet another sign of a slowdown in the global economy.
Australia’s key index ended down a touch, while stock measures in China and Taiwan also fell.
Hong Kong’s market edged higher while India’s benchmark Sensex surged 3.8%.
Oil prices plummeted below $106 (Rs4,696) a barrel on Tuesday in Asia trade as investors turned their attention to slower economic growth after hurricane Gustav subsided and appeared to have spared a number of US Gulf Coast oil operations. On Friday, oil settled above $115 a barrel.
Sliding crude prices sent oil companies in Asia sharply lower, with Chinese upstream firm Cnooc Ltd shedding 5.2% in Hong Kong. Leading Japanese oil explorer Inpex Holdings Inc. plunged 6.5%.
But airlines gained on the same news, with China Southern Airlines Co. Ltd rising 2.6% in Shanghai. Air China Ltd shares climbed 2%.
Airlines shares in Hong Kong also soared, with Cathay Pacific rising 3.5% and Air China surging 8.7%. The sector’s advance helped the Hang Seng Index recover early losses and close up 0.65% at 21,042.
Japanese market sentiment soured amid a looming political stalemate after Fukuda, 72, abruptly announced late on Monday that he was stepping down. His year in power has been marked by a deadlocked parliament.
“Foreign investors started selling in the afternoon session, and overall sentiment was sluggish due to political uncertainty following Fukuda’s resignation,” said Kazuhiro Takahashi, a strategist at Daiwa Securities SMBC Co. Ltd.
“Selling spread across the board, with investors dumping shares in the financial sector in particular,” he said.
Financial firm Mizuho Financial Group Inc. lost 1.1%. Among exporter-related stocks, Toyota Motor Corp., shed 1.5% and Sony Corp. declined 1.7%.
Elsewhere, mainland Chinese shares fell again, reaching a 20-month low on expectations of an economic slowdown later in the year.
The benchmark Shanghai Composite Index lost 0.9% to 2,304.89.
Banks extended losses, with Industrial and Commercial Bank of China, the country’s biggest commercial lender, falling 2.1%. Large Chinese banks announced strong growth in interim earnings reports last week, but analysts believe their profits will weaken in the second half of the year.
Investors have been disappointed at the lack of any positive cues on market support from the government.
In currencies, the dollar was trading at 108.06 on Tuesday afternoon in Asia, little changed from 108.27 yen on Monday, while the euro stood at $1.4549 from $1.4653.
Tomoko A. Hosaka in Tokyo contributed to this story.
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First Published: Tue, Sep 02 2008. 10 52 PM IST
More Topics: Markets | Asia | Japan | Thailand | Tokyo |